Mayor Murphy, who said the budget increase is driven by increases in utilities, pensions, negotiated contracts, insurance, and heart and hypertension benefits for police, is anticipating her proposed package will be cut.

"I don't expect that to sit firm," Mayor Murphy told the assembled council and finance members, who will continue to hold joint budget continue over the next two weeks.

Mr. McLaughlin said Tuesday night that a 6.12 percent tax increase "is not acceptable and either the Town Council or the Board of Finance or a combination of the two will have to rein it in.

"There are economies to be found; we must and will find them," he continued. "We must develop a budget that the taxpayers can embrace, and we must do it by controlling spending, not increasing taxes."

The mayor's $83,365,450 spending plan for the fiscal year that starts July 1 leaves the $50.6 million Board of Education request, which is up 6.4 percent, untouched. Last year Mayor Murphy recommended a $2.1 million cut in the school board request.

The mayor is proposing $31.2 million for the town's operating budget, a 5.43 percent increase, and $1.6 million for capital items, although departments requested $3.5 million for capital items.

"A lot of the department heads willingly did without," Mayor Murphy said. "I appreciate how far they can stretch a dollar."

The budget for the current year, which ends June 30, is $78.6 million, with $47.6 million for the Board of Education and a town operating budget of $29.7 million.

The 2005-06 budget proposal includes revenue estimates of $23,331,013 from town fees, interest, state grants and reimbursements.

That revenue includes $400,000 the mayor plans on using from the
Waste Management Settlement Fund
for tax relief, as well as an additional $2 million from the undesignated fund balance for tax relief.

"It needs to go back to the taxpayers," Mayor Murphy said, remarking that when the undesignated fund balance is up, to her that indicates residents were overtaxed. It was $7.7 million as of June 30 (see related story on the town audit, Page S7).

The mayor said she is assuming "an aggressive" 98 percent tax collection rate.

"She is pushing the envelope for tax collections... and this is not the year to push that envelope," Mr. McLaughlin said, remarking that he wanted a 97 percent collection rate, but had offered to compromise at 97.5 percent.

He said the town "has yet to finish a fiscal year with a tax collection rate that high" and noted that the 2003-04 tax collection rate was "97.84 percent, an historical high."

"We are embarking on a difficult budget year," Mr. McLaughlin said, remarking that the grand list increase is low and "projected non-tax revenues are experiencing a minuscule increase."

"Because there is a resistance to embrace zero-based budgeting, the mayor needs to find every source of non-tax revenue that she can find," the finance chairman said.

Interim Superintendent of Schools
JeanAnn Paddyfote
said she was "encouraged" the mayor left the school board's request intact.

"It's a good positive first step out of the gate," Dr. Paddyfote said. "I'm optimistic we can justify our request."

Board of Education Chairman
Wendy Faulenbach
said she is "very pleased" the mayor did not cut the board's request.

"It's a positive step in the budget process," she said. "We'll see where it takes us."

The school budget is slated for review March 2.

Mayor Murphy said she had asked the school board to adjust its format to make the school budget more understandable, and it had done so. The school board also went through the budget line by line and cut the superintendent's request by about almost $450,000.

Mayor Murphy said her budget supports the Police Department and includes funding for road maintenance, including the proposed improvement of 48 miles of roads. There is $80,000 for a new economic development post and money for a new detective position.

There is a new account with $6,000 for the
Tricentennial Committee
and $20,000 for a new part-time assistant fire marshal.

The capital budget includes $120,000 for a new plow truck and $60,000 for painting, reroofing and repairing the railroad station.

A few positions have salary adjustments to bring them more into line with the job requirements.

Councilman
Bob Guendelsberger
said an increase of $7,900 in one year "is a large increase" for one employee.

"I don't think this budget will be an easy sell," he remarked.

Prior to the budget presentation, Mayor Murphy gave a short state-of-the-town address, thanking council members, whom she said "never failed in assisting me" and showed good humor in stressful situations.

She also thanked finance officials and employees for their support.

The mayor noted that with cutbacks at Kimberly-Clark and Nestle last year, there have been "a few trials and tribulations in reference to the grand list" - the total assessed value of taxable property in town as of Oct. 1, 2004.

Finance Director Ray Jankowski said the net collectible grand list is $2,174,503,275, which is up $35.4 million, or 1.65 percent.

Despite the modest growth in the grand list, Mayor Murphy is optimistic the town "in its resilient manner will develop... in a positive way."

Ms. Bennett, who said she was injured at her job at Wal-Mart and can no longer work, said she and her teenaged son would be homeless without the help she receives at Social Services. She said the department is "a lifeline for families" facing tough times.

Peg Molina, the Social Services director, is asking for an additional staff person, a full-time counselor advocate. She said with the current staff "we don't get to the proactive things that can help people out of poverty."